Live-Blog: James Murdoch Appearing Before Leveson Inquiry Into U.K. Media Ethics

Breaking News … Refresh for latest live-blogging from London …

In London this morning, James Murdoch is expected to answer questions and give evidence as they relate to phone hacking at former News Corp tabloid News Of The World. He may also be probed about alleged email hacking at The Times, also controlled by News Corp. Murdoch stepped down as head of News Corp’s UK press arm, News International, in February amid the ongoing phone hacking scandal. The move was not a tacit admission that he tried to cover up phone hacking, he said in a March letter sent to the Culture, Media and Sport Committee that read in part, “This is untrue. I take my share of responsibility for not uncovering wrongdoing earlier. However, I have not misled Parliament. I did not know about, nor did I try to hide, wrongdoing.”

The Leveson Inquiry into UK media ethics began last fall, spurred on by allegations of phone hacking and bribery at News Of The World after the scandal broke wide open in July and it was revealed that the voice mail of murdered school girl Milly Dowler had been accessed. Since then, the scandal has mushroomed and last week it was reported that almost 50 new civil claims have been filed. There are said to be 4,791 potential victims and police are believed to have identified 1,174 likely victims of phone hacking out of 1,892 who have been contacted. About 60 cases have already been settled and News Corp maintains it is determined to settle all possible cases. Both James and his father Rupert appeared together before a Parliamentary committee last July and James reappeared before the committee in November. This time, James is on his own again. Rupert will give evidence tomorrow and is also scheduled for Thursday morning if necessary. We’ll be following the testimony closely over the next few days. All times below are UK local time:

Murdoch arrived at the high court over an hour before he was due to give testimony, Financial Times correspondent Ben Fenton tweeted.

10:00 James Murdoch is sworn in and Robert Jay QC, counsel to the inquiry, who begins by reading off Murdoch’s resumé.

Regarding BSkyB, Murdoch explains he left the company because he wanted to avoid the lightning rod “some people were trying to conflate” with the past of News International. Murdoch says he thought it was better to resign.

Murdoch is asked if he discusses business with his father, Murdoch answers in the affirmative.

10:11 Jay asks if there were deficiencies in News International’s systems for identifying legal risks. Murdoch says that with respect to news gathering practices, it’s self-evident in hindsight that whatever controls were in place failed to provide suffieient transparency.

Jay asks: Did you make the connection between legal risk and ethical risk?

Murdoch says: “I think that’s the right connection, however, I was assured from a standpoint of jounalistic ethics…that extensive training had gone on and was continually going on…Particularly in light of voice mail interception in 2006.”

Murdoch is asked if he read the News Of The World and The Sun on a regular basis. He answers he tried to familiarize himself with them.

Jay asks if he saw risks associated with the brands and Murdoch says he recalls receiving assurances regarding a code of practice.

10:15 Murdoch says he wasn’t in the business of deciding what to put in the newspapers and that he relied on the editors. Which he allows ultimately proved to be wrong.

Murdoch asks to “seek to help to situate myself” in the companies at the time. Lord Justice Leveson lets him speak. He explains his role in developing longer term strategies. “The day-to-day management of the legal affairs” was something the directors were handling.

10:27 Jay turns to phone hacking and asks Murdoch to confirm his position that he never saw or read the so-called “For Neville” email [which contained trasciptions of hacked voice mails]. He maintains that is still his testimony.

10:34 Leveson asks if Murdoch ever probed the adequacy of the internal governance at News International when he took over and after News Of The World royal reporter Clive Goodman and private investigator Glenn Mulcaire were arrested [for intercepting voice mails of members of the royal household].

Murdoch says it was clear to him that in the newsroom “in the past it had not been tight enough.” He says he believed the new editor had strengthened the governance.

10:45 Regarding the “one rogue” reporter (Goodman) stance, Murdoch reiterates he had assurances that everything had been fully investigated. Jay says Goodman has claimed he tried to alert Murdoch to further improprieties, but Murdoch says he doesn’t recall a meeting with News Of The World editor Colin Myler on that subject.

Leveson asks if Murdoch can think of a reason that Myler or legal counsel should keep this information from him.

Murdoch says he’s struggled with “why wouldn’t they have just come and told me – and they didn’t.” He says he thinks it must be that they believed he would have said “cut out the cancer” and that there was some desire not to do that.

11:07 Murdoch notes that in his experience dealing with legal manager Tom Crone and Myler, there wasn’t a proactive desire “to keep me up to speed.”

Jay is grilling Murdoch on the large settlement in the Gordon Taylor case and says he was given “strong advice” to settle because it was a case that would have been lost and that would have dragged up the past. He says that Crone and Myler seemed anxious to get out the door and settle at a high number. [Taylor, a former soccer player and head of the Professional Footballers’ Association sued over the alleged hacking of his cell phone. In July 2009, The Guardian reported he was paid about $1 million in a settlement.]

Murdoch maintains that Crone and Myler did not go through Clive Goodman’s allegations of more widespread wrongdoing. If they had, it would have been a longer meeting, Murdoch says. Murdoch has insisted it was a short meeting.

11:22 Murdoch says when he heard about allegations of wider spread phone hacking in the 2009 Guardian article (he was in the US at the time), he was told it wasn’t true.

Jay asks: Are you sure Myler didn’t then reiterate the reasons for the earlier Gordon Taylor settlement: “Namely we had to pay this man to keep him quiet” so as not to risk the paper?

Murdoch says, “No, they said it wasnt true.”

11:23 The inquiry has taken a short break.

11:38 They’re back and turning to questions regarding politicians.

Jay brings up a phone conversation Murdoch had in 2005 with then Prime Minister Tony Blair and Murdoch confirms he, or his public affairs people, called the meeting.

The questioning surrounds discussions over soccer rights, the possible intervention of the European Commission and the possible impact on BSkyB should the EC have decided to split rights. Murdoch allows it could be referred to as business advocacy, or lobbying.

Was the purpose to bring Blair onside should the EC intervene, Jay asks?

In conversations like this I would have said it was just to make the Prime Minister aware of “what proposals were flying around,” Murdoch says. Soccer is “a major British franchise,” he adds.

11:47 Murdoch has been asked about meetings with David Cameron before he became UK prime minister. The talk turns to News Corp’s bid to acquire the rest of BSkyB.

Jay says certainly News Corp would do two calculations on the bid going through in terms of regulatory issues: One on the basis of a Tory government and one based on a Labour government.

Says Murdoch: We would look at the situation like we would in any country, like Turkey.

“It could be Mali or Outer Mongolia,” Jay replies. He then asks, “Is your evidence that you thought a Labour government elected in 2010 would be more favorable to the BSkyB bid?”

Murdoch says he doesn’t think the politics would have been high on the company’s mind. He says from a regulatory perspective News Corp felt it was likely to go through either way. There was a concern about how long it would take, but it was more duration than likelihood, Murdoch adds.

11:55 In a 2009 drinks meeting with Cameron and Murdoch, Jay asks if it was made clear to Cameron that The Sun would endorse the Conservative Party. Murdoch says he had understood the paper would either be endorsing the Conservative Party or moving away from its traditional support of Labour. This “seemed” like it was welcome news to Cameron.

Jay asks if it was part of News Corp strategy to wait until the outcome of the election. Murdoch responds he thinks it was more to await the end of the elections, not the outcome – “so it didn’t become a political football.”

12:01 Jay then refers to a dinner on December 23 2010 at the home of Rebekah Brooks where Murdoch and Cameron were both present. The dinner was just after Business Secretary Vince Cable had been stripped of his responsibilities concerning the BSkyB bid after being found to show bias.

Murdoch says Cameron didn’t speak with him regarding the bid except that Cameron reiterated what he had already said publicly; that Cable’s behavior had been unacceptable.

Murdoch says, “I imagine I expressed the hope that things would be dealt with in way that was appropriate and judicial. It was a tiny side conversation just before dinner with all these people there.”

12:06 Jay turns to the subject of treasury chief George Osborne and asks Murdoch if they are friends. “I’m friendly with Mr Osborne,” Murdoch says and confirms he has been to Osborne’s home. He says he thinks he has held one discussion with Osborne regarding the BSkyB deal. He describes himself as “grumpy” and says he would have lamented that the deal was taking so long to be approved by regulator Ofcom.

12:16 Leveson says to Murdoch: The press has a megaphone and asks if he had, as a businessman with the weight of the press behind him, greater access to politicians.

Murdoch answers, “I haven’t actually spent that much time with politicians personally…The vast majority of my career has been making television here.”

Still, Jay presses, “In discussions with politicians, was it obvious to you they would be interested in knowing if your newspapers would suport their party?”

Murdoch responds, “Yeah, I think all politicians would be interested…to be able to avail themselves of that megaphone…that’s reasonably evident.”

Jay continues, “But it must occur to you that the balance of power is more with you than with them because they are so interested in knowing if your papers will support them.”

Murdoch: “I hope that’s not the case…I just don’t think there’s that very old fashioned view of big media proprietors and being able to dominate the landscape. I just don’t think that’s the case anymore.”

In a rare moment of levity from Jay, he says “I’m not actually concerned with reality” to which Leveson interjects, “I’m not so sure you mean that.”

12:26 Jay is now asking about the period between 2008 and the May 2010 general election in the UK.

Jay asks if Rebekah Brooks took most of the meetings with politicians. Murdoch says, “She would have been closer to those issues than I was.” The general way of working was that “from time to time” she discussed those meetings with Murdoch, “but also with my father with some frequency.”

12:47 Regarding the BSkyB bid, Jay says that from a News Corps perspective, the company had a good case in law on plurality issues. But, he says, “as we’ve also accepted running along parallel lines there was a potenitally explosive political issue. People had it out for News Corp.”

Murdoch says it’s more than political: “The other newspaper proprietors in the marketplace had a commercial fear around the size and scale” of News Corp’s interests in the UK. It was a pure competition argument that they turned into a future threat to the plurality of media in the UK.

The BSkyB bid is further discussed. We’re now talking about News Corp’s head of public affairs Frederic Michel, Culture Secretary Jeremy Hunt and his special advisor Adam Smith.

12:54 In an email, Michel says a note from Smith said the UK government would be supportive throughout the (bid) process.

Jay adds “It’s pretty clear you were receiving information along the lines the UK government on the whole would be supportive of News Corp.”

Murdoch says it’s not special information. “I think Mr Hunt had said personally he didn’t see any issues.”

Jay details contact between Michel and Hunt and asks if Murdoch and Hunt discussed the BSkyB bid on June 15, 2011. Murdoch says he’d be surprised if it hadn’t been. “It would have been the same position I took publicly and with anyone who would listen,” he says.

Murdoch says he sought an official meeting with Vince Cable, but was not getting anywhere. Jay then asks if he communicated through his “cheerleader” Hunt. Murdoch replies he thinks that’s “unfair.”

1:17 Murdoch says: “You can call me naive about it, but I thought these senior ministers were serious people who try to do their jobs.”

Jay suggests the BSkyB deal had to do with The Sun newspaper’s support of the conservative government: There’s one minister who says he doesn’t like the Murdoch press and he’ll hold it against them and then Hunt likes the Murdoch press, “that’s going to be your calculation, isn’t it?”

Murdoch says he beleives Hunt took the advice of the regulators and visibly bristles for the first time:

“I’m sorry Mr Jay but that is absolutely not the case. The question of support for politicians in a paper is not something I would ever link to a an issue like this. I simply wouldn’t do business that way.”

The inquiry has broken for lunch.

It looks today like Jeremy Hunt is going to have some splainin’ to do…

2:05 The inquiry has resumed.

Jay is going over emails that relate to Vince Cable, the BSkyB merger, its impact on Scotland – where there are several thousand News Corp employees – and First Minister of Scotland, Alex Salmond.

Murdoch interjects that it is “legitimate and normal to reach out to a politician about economic benefits” of a buisness in his consituency. He calls it “legitimate advocacy.”

2:22 Vince Cable wanted an independent view and Murdoch thinks it would have been normal to have a meeting with Cable and his advisors to lay out the merger. It became “self-evident” in interviews Cable gave after he was removed, that he was taking other people’s advice, Murdoch says. “We wanted to have the chance to sit down with him to make our case.”

Fred Michel met with Rupert Harrison, chief of staff to George Osborne, who said Cable “made a political decision probably witout even reading legal advice,” according to Michel.

Jay reads that Michel told Murdoch “Jeremy (Hunt) tried to call you…he has received strong legal advice not to meet with us,” because it could jeopardize the (BSkyB bid) process. Murdoch allows he was displeased.

Murdoch says he believes Hunt called him to apologize for cancelling the meeting.

2:36 The talk has turned to an “issues letter” from regulator Ofcom that said it had “potentially material public interest issues” with regard to the BSkyB acquisition.

The letter was sent in late December 2010 after which Rebekah Brooks forwarded an email to Murdoch saying George Osborne is in “total bafflement.”

Michel told Murdoch he had a good debrief with Hunt, “He is pretty amazed” by Ofcom’s findings and says there was clear bias. “He very much shares our views on it,” Michel said of Hunt.

2:50 On Dec 21, Vince Cable’s “war on Murdoch” comments were made public and Cable was subsequently stripped of his responsibilities in the decision on the BSkyB acquisition. Hunt then took over Cable’s responsibilities.

On Christmas Eve 2010, Michel says he spoke to JH (presumably Hunt or his advisor). Jay says there was informal contact between Michel and Hunt’s advisor after that.

Hunt had a formal meeting with Murdoch in January.

Jay suggests Hunt must have taken the advice that formal meetings would be OK
but informal contact would be inappropriate.

Murdoch says he thinks the perception would have been that informal contact with him would raise eyebrows, but formal contact would be otherwise.

2:56 Jay reads a January 23 email that says Hunt believes “It’s alomst game over for the opposition” – meaning those opposed to the BSkyB deal.

Jay warns that Hunt was still acting in a quasi-judicial role, “and yet he hasn’t given his decision,” on the takeover.

Murdoch maintains he took everything he heard from Hunt “with a grain of salt.”

Jay: “You keep saying you had a good case, but the judge is also telling you you had a good case.”

3:05 Jay has just read an email that says: “Confidential. JH statement. Managed to get some infos…(although absolutely illegal).”

There’s a collective gasp in the room and Murdoch responds by pointing out that there’s a “greater than and an exclamation point.” They “mean it’s a joke,” Murdoch says. He allows he’s not sure if it’s legal.

Jay continues reading emails, saying that Murdoch was receiving information as to the mindset of the Secretary of State.

3:20 With regard to Michel or Murdoch hearing from advisors to Hunt, Murdoch says, “I never saw the conversations as covert…and I assumed that Mr Hunt’s office at the center of it was trying to have a discussion with all relevant parties.”

Jay reads another email from Michel that says JH “believes we are in a good place.” The email came after Hunt’s speech to Parliament.

In a further exchange regarding News International’s Scottish Sun and Scottish First Minister Alex Salmond, Murdoch says of any “insinuation” of “quid pro quo with the editorial and political agenda, I can tell you categorically this is not the case.”

3:25 Jay says there “are about 80” emails to go but says he’ll not read them all as “the flavor” doesn’t change much.

3:57 Murdoch denies that he “felt pretty good” about getting information from Hunt’s office with information about the ongoing BSkyB deal. He says when he received information that the UK regulators were leaning towards referring the matter to the Competition Committee, he “felt just the opposite.”

Jay says there is communication saying that Hunt and Murdoch were to have a phone conversation in May. Murdoch says he doesn’t recall a conversation.

Moving onto June 30, after the public consultation on the revised UIL (undertakings in lieu which removed Sky News from the BSkyB deal), an email to Murdoch reads Hunt is happy with the debate.

July 7, 2 days after The Guardian article on the hacked Milly Dowler emails, Jay says Murdoch had an email from Hunt regarding discussions at the Prime Minister’s residence and the eventual inquiries into media practices. Jay to Murdoch: You were given confidential information as to government thinking.

Murdoch says he doesnt recall reflecting exactly on all of that email. “It was a very busy time, as you can imagine.”

The last email Jay reads is from July 11: Mr hunt was going back to regulators for further advice but in light of revelations from phone hacking…Jay trails off.

Murdoch says the BSkyB bid had already been withdrawn.

Murdoch is asked if Hunt fulfilled the quasi-judicial process.

Murdoch says he can’t say that Hunt didn’t. “He was incredibly rigorous in the process around the undertaking.” Murdoch added that Hunt never ultimately decided, but that at “every step of the way, he followed the advice of the independent specialist he was going to and exctracted understandings and extracted strengthenings of it.”

Jay asks: “Are you to invite us to say there’s absolutely nothing surprising” in the email exhcanges or “do you think there are surprising things in your own company’s conduct and the departmental conduct?”

Murdoch contends a very large public affairs engagement is normal in such a big merger, but that it’s a “totally separate quetsion from ethics of the press.”

Jay: “Might it be possible to say the reason you do not appear to be evincing much of any suprirse is that you would expect government to respond favorably to a bid by News Corp since support had been given to at least the Conservative Party on 30 sept 2009 and you are somewhat blind to what might appear to the rest of us to be a quid pro quo?”

Murdoch reiterates: “There is absolutely not a quid pro quo for that support. The BSkyB transaction was entirely separate.”

4:09 After a short discussion in which Leveson asked Murdoch for his views on press regulations and plurality, the Leveson Inquiry ended for the day.